24. October 2012–
The deal is aimed at accelerating Yelp's international expansion and will add two million reviews and 15 million unique monthly visitors to its stable:
"Combine that with more than 30 million Yelp reviews and 78 million unique monthly visitors, and you can see why teaming up will make us even better at helping you find that perfect restaurant/museum/dentist/hair salon/shoe store in Los Angeles/Memphis/London/Hamburg/Singapore," Yelp’s CEO Jeremy Stoppelman (above) said in a blog post. "It’s a beautiful thing, really..."
The total purchase price for Qype – worth about $50m – will be paid for by about €18.6m in cash and 970,000 shares of Yelp's Class A common stock. It's unclear whether Yelp will replace Qype's branding or keep it, though the former seems likely.
"All I can say is that I'm excited by the potential and that I think it was the right step," Qype founder and current board member Stephan Uhrenbacher told VentureVillage.
Also today, Yelp revealed its preliminary third quarter 2012 results, beating analysts' expectations with today's estimates of $36.4m in revenue and a $2m net loss. The Qype acquisition will be recorded in results next quarter.
If you can't beat 'em, acquire – and keep an eye on Google
Yelp, launched in July 2004, is strong in in its home base, the US, but has struggled to compete with Qype in Europe, particularly in Germany and the UK. Qype launched in March 2006 and is backed by about $23m funding from Advent Venture Partners, Partech International and Wellington Partners, according to CrunchBase.
The platform that will emerge from today's merger will have a much better chance of competing with Google to become users' de facto choice for local recommendations, as TechCrunch's Ingrid Lunden also noted today.
Image credit: Brian Giesen